Time interviewed Paco Underhill, a retail consultant and the author of Why We Buy: The Science of Shopping, to find out how the average American consumer shops and thinks these days. Turns out, according to Underhill, there are three types of “average consumer” out there now, and—you may have noticed this already—the era of the big box retailer is in decline.
Underhill says that most American consumers fall into one of these three categories:
- Those “who are in immediate danger of being downwardly mobile.” Regardless of current socioeconomic level, layoffs and other financial emergencies have caused them to stop spending entirely.
- Those who aren’t in danger now but know someone who is, and who have stopped spending out of extreme caution and a sense of needing to be more financially responsible. “It’s fundamentally healthy over the long term, but it’s painful over the short term.”
- Those who “have very real piles of money” but who have “learned that conspicuous consumption is bad manners,” and/or who have adopted the idea that financial responsibility is a moral issue.
Other highlights from the interview:
- Retail stores are getting messier, because people are picking up items, carrying them around, and then taking them out of their cart at the last minute.
- Reading labels is a more popular activity: “It used to be that label reading was linked to income and education. And now that’s linked to literacy. Everyone is doing it.”
- The concept of buying used seems to be increasing in popularity.
- “We have reached the apogee of the big box,” and going bigger now “is actually starting to be counterproductive.” Underhill says retailers are going to have to learn to edit. We find this interesting because he also points out that consumers have greater pricing transparency than ever before thanks to web access via mobile phones. How does a retailer compete on choice and pricing without bloating up their inventory?
- “I think, as a culture, we are over-stored. All store chains would be healthier if they were smaller.”
Read the full interview at Time.com.